A swell washed over one of Rio de Janeiro’s main squares, and morphed into magma. Standing at its crest is a statesman, if not a working class king. Luiz Inácio Lula da Silva’s July 7 event at Cinelândia Square in Rio de Janeiro marked one of the smoothest steps in his bid to restore the country’s hopes for a future. Conditions for his campaign to crystalize into victory in the October federal elections grow by the week. Crowds fifty thousand strong heated the downtown pavement, driving the process forward. By contrast, Bolsonaro gathered at most ten thousand in a state his thugs supposedly control.
The PT (or Workers’ Party) is more multiethnic than ever in Rio de Janeiro State, creating hopes its broad diversity will shape a future government. Yet Lula’s popularity in the state confronts another seat altogether, that of the very military academies and colleges through which the generals orchestrated Bolsonaro’s rise a decade ago. Entitlement to power is what their authoritarian training charts. A clause in Article 142 of the 1988 Constitution is the joker in their deck meant to raise them above democracy and law. Their obsession with dominating the State apparatus spins their hysterical yarn about the corruptibility of electronic voting booths – when it is Kryptus, a cyber security firm connected to the military itself, which holds the keys to the encryption of the ballot boxes. That Oracle is also part of the pact underscores how deeply Brazil’s military has sold the country out to the United Oligarchs of America.
THE PEOPLE AND THE PLATFORM
On stage, Afro-Brazilians, lesbian militants and trade unionists flanked and upstaged the white men, darkening their roots and coloring their unconscious. Lula’s wife, sociologist Rosângela da Silva, aka “Janja”, warmed younger faces by pulsating ripples of militant resonance. She cements Lula’s art of negotiating into a joyous feast, bringing soul to new alloys and daring alliances. Lula’s campaign events may still amount to merely an inkling of what occurred in Chile in 2019, but given the attacks against the Workers’ Party (PT) waged by media conglomerates such as the Globo Group, his message of prosperity might make his pragmatism pay off in the end.
Rio de Janeiro may not be what analysts like to call a microcosm for the challenges Lula’s campaign faces, but it does show the fragmented and very violent nature of the struggle for political hegemony in Brazil. Despite its size, the state is home to one of the most progressive cross-sections of class, ideology, professions, ethnicity and culture, the accomplishments of which on the local level rarely fail to trigger international interest. The former capital is where the riot phase of the June 2013 uprising was most violently nipped in the bud, while State investment in large international events (the World Cup and Olympics, especially) equates to mismanagement, fraud and corruption. It is also where the State police works as an occupation force against poorer communities.
Not least of its brutal contradictions is that progressive thought is most associated to the upper middle class white population living in the ocean-bounded South Zone. Behind the mountains, evangelical churches dilute the class struggle with racial politics, though the faithful fail terribly to notice their directors are as white as any surfing star or samba school impresario. Likewise in the Armed Forces, where a clear majority of Afro-descendants and mixed-Indigenous in the corps salute a president known for his despicable anti-Black and violently anti-Indigenous racism.
Social contradictions long ago failed to transform into greater equality and deeper ethical integrity. If anything they confirm how the tensions lie elsewhere, perhaps even beyond the reach of hope. Not that polls are suggesting anything but Lula’s victory. To damper their results, signs of a coup d’état flicker through the country’s federal institutions. Woke-baiting and confusion-mongering can do little to deviate the sense of insecurity simmering in Brazil’s military caste and oligarchs.
For three years, a brazen “secret budget” has swayed Congressional Representatives and Senators from initiating impeachment procedures against the current President. The Judiciary has mainly cowered from indicting the Executive for milking everything the Budget can afford to ensure votes. Despite half-wittingly abandoning Bolsonaro, the Globo Group still teams up with its evangelical rivals from the Record Group to make sure Congress keeps from falling to the opposition. From these most decrepit sources of media disinformation, a report short of lip service was devoted to the PT rally in Candelaria square, while all poll results favorable to Lula are muttered with contempt.
Even though the authoritarian government has repeatedly threatened terror and coups in its three years in power, what it has done best is to crouch into careerism. Three months await the next presidential elections. As many have put it, it is the measure of time “before being happy again”.
SURFDOM ON THE ROAD
With no social welfare program in place to confront Sars-Cov-2, over six-hundred thousand Brazilians have succumbed to Covid-19 according to the lowest of estimates. One in ten Brazilians have seen someone within their circle die from Covid-19. Meanwhile, hundreds of millionaires flee to G7 countries complaining from behind their privatized prisons that the country’s not moving forward. Negationism and anti-vax are not merely paranoid obsessions resulting from ignorance about science. They are government programs bent on gutting the very institutions that care for persons perceived by Bolsonaro as the real enemy. Ironically, in 2018, many had been fooled by illicitly funded disinformation campaigns on WhatsApp, joining the ranks of the president’s most fervent supporters.
Behind their backs, Bolsonaro let loose the bulldozers of deindustrialization. Distracted social commentators have thrived on spotting social polarization where the symptoms of class war abound. What has struck society is market-driven leveling, the plying force of privatization sending masses into a precarious existence. Brazil’s socialized health care system has crumbled through the contempt of those who have never depended on its essential services. The anti-Covid-19 vaccination program only took off after a congressional inquiry began examining mismanagement and embezzlement in the Ministry of Health. At the time, it was under the helms of a general with no experience in public healthcare and a fraudulent one in logistics.
Since the onset of the pandemic, the liberal conservative ideal of gutting social welfare programs has thrown the public into food insecurity. Over 30 million now barely survive in misery, and 153 million suffer from food insufficiency. All this in a country that produces 3.7 kg of grain per citizen on a daily basis.
Economist João Saboia, from the prestigious Economics Institute of the Federal University of Rio de Janeiro (UFRJ), has created an indicator to measure rising rates of inequality. With a spike at 0,947 on a scale of 0 to 1, it speaks of a calamitous situation. Income of the 20 percent poorest fell by 23.3 percent in the first year of the pandemic alone. Since 2014, it had fallen 27.3 percent cumulatively, while gains among the 20 percent highest income earners have increased steadily by 21.1 percent. In hyperactive spats of privatization, Bolsonaro’s minister of finance, Paulo Guedes, has edged the general population toward a precipice.
These indicators are hardly surprising. The knowledge they encapsulate converges in the sadistic cynicism behind the president’s continual portrait of the country as being in an impending state of communist infiltration. Supported by his Minister of Defense, the military commander of the Joint Chiefs of Staff, the president’s persistent attacks on the Supreme Electoral Court instill a sense of institutional chaos.
At the level of civil society, Bolsonaro’s unfailing base are the gun clubs. In recent weeks, his social media advisors have spread tantalizing tales as to how Lula’s victory would close the gun clubs and replace them with libraries. With official stats accounting for the existence of a million and half guns in the hands of civilians matched by the closure of over 700 public libraries, it makes sense to represent the upcoming elections as a struggle between culture and barbarism. With Taurus Arms Inc. helping to bubble up the stock exchange, the accumulative drive behind financial capitalism clearly needs firepower upon which to lean.
Concomitantly, depletion of funds for higher education has plunged public investment in scientific research and post-graduate scholarships into an endless downward spiral. No less than four ministers of education have fallen, the last one leaving his building handcuffed by Federal Police. This is a struggle pitting the four-stars against the PhDs. Allegations made by the latter of the “shadow ministries” aimed at undermining constitutional institutions are bolstered the former with their decrees on classifying government dealings for a century.
While society buckles, industry can barely keep from shedding its parts. Brazil’s mega mixed-ownership State-controlled utility Petrobras industries, once a latter-day example of a Galbraithian semi-benevolent enterprise, has gone from leaping amongst deep-sea rigs to limping on stilts as its gas stations and refineries are sold off piecemeal. The selling of its assets has opened valves for foreign investors, while government-appointment administrative boards have ensured no profits reach R&D, let alone public investment.
Privatizations have pirated Brazil’s national wealth, while its moneymaking has again been reduced to primary sector commodities. Two-thirds of the country is unemployed and let loose by the Central Bank to financial trickery by means of bloated interest rates on credit cards, overdrafts and loans. The top zero-point-one percent believes it has been historically entitled to steer democratic processes according to its own personal interests.
Conservative indicators show South America has greater proportional wealth concentration than the Golf State Petro-Monarchies. Brazil’s oligarchs make Russia and Ukraine truly look like the communist successors of the Soviet Union. The business model followed involves producing deliberate underemployment, false flag news bulletins over even the slightest economic downturn, over-exaggerations by corporate media to drive desperation, thus seeming to justify caps on social spending for decades. Preemptively framed for corruption are precisely those most geared to fighting it.
RESISTANCE TO IDEOLOGY MEANS AWARENESS OF THE ECONOMIC STRUCTURE OF THE GLOBAL SOUTH
Against the fear mongering prompted by conservative leaders, the only sector of the population meant to lose out from a PT victory are the richest and most powerful sectors they represent. Yet against the hopes and even faith of opposition politicians and militants, a PT victory will not usher in radical economic transformation.
The truth is that, in Brazil, even the slightest change at the top can trigger monumental ramifications at the base. Lula’s team has to work through the margins. Among the young economists committed to his vision, many have as much training in the US as back home. A Nobel Prize may await those who achieve reversal of capital flight from the Global South and prove how socialism today equates with smashing liberal hegemony’s parasitical incentives to deindustrialize competitive economies. What can be grasped of Lula’s economic platform, at least for the time being, follows half a dozen crucial axes.
Given the current climate of world war, the most urgent move might very well be to change Petrobras’ pricing policy for natural gas, oil and gasoline. The struggle over ownership of this firm was one of the factors leading to President Dilma Rousseff’s impeachment through a congressional coup d’état in 2016. Once she was out of the way, the privatization vultures flew in on the vulnerable corpse called publicly owned property. Today, it amounts but to a third of the massive utility’s holdings. That these vultures soon morphed into hedge fund hawks merely underscores how lucrative the company has continued to be despite media disinformation aimed at convincing the public of the contrary.
Dilma’s policy was to invest one third of new income from the offshore “pre-salt” deep-sea oil discoveries into higher education, while another third was to be set aside to upgrade the socialized health care system. Answering to the most progressive moment of the 2013 uprising, Dilma also sought to cap rising energy prices overall. When that also included caps on interest rates set by private banks, the FIRE sector wasted no match to make her government burn. The yellow and green color revolution would ensue two years later.
Skyrocketing prices at the pumps could easily benefit Brazilian society. That it does not merely stresses the point of what dwindling public shares in Petrobras fails to avert, even for what does remain in its powers to invest socially. The current Petrobras board of administrators has simply ignored investment in national energy security. Such are the hallmarks of deindustrialization made plain especially when astronomical profits (estimates for the 2nd quarter of 2022 project BRL 60 billion in profits and BRL 58 billion in dividends) fill the pockets of private investors.
The second axis of Lula’s economic platform will be to invest heavily in culture and education again. Few countries have produced as many artists, composers, musicians, dancers and writers as has Brazil. When the country lost the bossa nova pioneer, João Gilberto, Bolsonaro scoffed. Innovative expressions in cinema and art have had to fend off agitprop acts of censorship by the self-avowed Holocaust deniers and white supremacists calling themselves the Free Brazil Movement (MBL). Censorship has also shifted of late to the saturated judicialization of Brazilian society, whereby opponents to the government simply end up being sued for libel should they dare to speak out.
Swallowed whole by a shadow ministry of protestant sects merging Education and Women’s Rights, the Ministry of Culture has been demoted to a subservient role. Lula’s plan is to provide the artistic community with a means to break their dependency on private funding from either media or finance.
The presidential candidate has spoken at length and at times with fury of the suffering Brazilians have had to endure over the past three years of massive cutbacks. For the 2024 budget, he has promised to reintegrate the poor into the government’s budget. The post-impeachment government of 2016 immediately voted for a constitutional amendment forbidding the increase of social investment beyond inflation. Two so-called labor reform packages have also contributed to the immense hardship experienced by the public at large. This legislation has essentially stripped workers of legal protection against hiring practices, salary reduction, precarious work conditions, and lay-offs and firings. The shift has sacralised employers and their word. There can be no dignified future for the country without reverting these hypocritical measures.
In addition to including the poor into the budget, the next strategy aims to draw the wealthy back into tax justice. For the top 2 percent, Brazil is essentially a tax haven. Companies basically pay no taxes on profits or dividends resulting from capitalization. Brazil maintains double tax exemption treaties with scores of tax-free domains, thereby making tax avoidance legal. The average salary in Brazil is only twice that of the already absurdly low minimum wage. The Oligarchs and the Upper Middle class rant about the illusion of excessive taxation while refusing to accept their responsibility for social decay. At BRL 1000 (roughly USD 200) minimum wage has not changed since Bolsonaro was elected four years ago, despite the country seeing yearly inflation rates reaching 10 percent. Almost all of the property owned in the country lies in the hands of roughly five percent of the population. In order to get the funds to redistribute national public wealth, taxation policy has to become fair, if not radically progressive.
Both Michael Hudson and Thomas Piketty have argued that taxing productive labor is a useless and merely illusory policy. Most of the accumulation produced by the wealthiest Brazilians already sits outside of the country anyway. What has to be taxed, if it is truly to work to skim down the rentier elite’s concentration of accumulated wealth, is land and real estate revenue, inherited wealth as well as income from non-productive sources, such as dividends. Even tax exemptions and incentives can revert into major funding for the creation of equality.
What Lula’s economic team must fend off is the infiltration into their ranks of economists linked to hedge funds and the oligarchs. As usual, the financial elite uses its ownership of private media to work against socially inclined tax policies. What gives hope is how even monopolistic concentration of media fails to keep the public from the knowledge of how Brazil’s elite descends from the slave-holding plantation systems, whose tax-free benefits are ensured by the four stars and the black gowns. This caste of multimillionaires could care less about the lack of safety the country’s overpopulated cities face as jobs are stripped from the population.
The ideology of liberal democracy serves the dominant sectors only when privilege is assured. Otherwise, as elsewhere, they hesitate little before calling in the henchmen.
This also explains why Lula’s silence on the details of his plan to fend off financialization. Modern Monetary Theory has no future outside of countries holding the monopoly over printing their own currency. Independence of the Central Bank may be concrete with respect to Brasilia, although nothing could be farther from the truth regarding Wall Street and the City. A country having as regressive a tax system as Brazil allows outward capital flow stemming from concentration of wealth on the one hand and debt extraction and production on the other. The is no revolving door to jam in Brazil as finance dictates to the State what to extract from society. Shoring up the Central Bank and reverting the capitalization of the private banks is the radical move Lula cannot fail to make. When he does so, he will need much more from China than the Belt and Road.
Pretentious media experts claim there is no risk of a coup d’état prior to the elections, though they say little regarding what comes after. What they fail to concede is that it has already occurred. One of its indelible signs is Bolsonaro’s circus regarding Russia. Russia hating means next to nothing in Brazil. Bolsonaro can prance about as a Putin ally, even sport the mantle of a true Global South crusader against the American Empire. At home, few are convinced, let alone notice. What Brazilians do know is that Bolsonaro is the closest foreign ally to Donald Trump.
Despite how it was Trump who escalated the militarization of Ukraine against Russia, Bolsonaro’s ploy is to keep twisting the narrative behind Trump and his alleged sympathies toward Putin. In turn, this become a trap for Lula, who has little choice but to remain tied to the U.S. That this amounts to simply giving up on Brazil is a fate his team must do a better job at countering than in the past.
Bolsonaro and Guedes’ destructuring of Brazil’s development will not be simple to reverse. In 2002, when the PT first came to power, developing Brazil’s potential could take root in the vast areas that were historically underfunded or non-funded since the end of slavery. However, over the past six years, the scenario has seen the dominant classes privatize the economy so as to lock it into regression and barbarism. They have fabricated an economic crisis, while articulating a slowdown of economic production in order to prevent the productive classes from gaining financial security and political courage. They prefer a society run by oligarchs concentrating wealth by indebting the population rather than one in which the cross section of the planet represented by the Global South may thrive through economic equality.
In the end, as far as Brazil is concerned it might just be easier to forget the past and build anew. By leaving Petrobras, Eletrobras, Embraer and the big public state-level utilities behind, a stellar landscape can be created by making it ever harder for the privatized firms to stay competitive. As it touches new ground, new ecosystems with trees in abundance may once again cover over a financial environment devastated by deforestation and catastrophic social erosion.
Norman Madarasz, Ph.D., is professor of political philosophy. His research deals with the philosophical critique of economic theories.